Polo Resources in joint venture with Axmin over Sierra Leone gold assets

Monday, Aug 01 2011 by
Polo Resources in joint venture with Axmin over Sierra Leone gold assets

Mining group Polo Resources (LON:POL) has signed a joint venture agreement with Toronto-listed Axmin Inc over a gold exploration project in Sierra Leone. The deal will see Polo acquire a 51% interest in a new company which will own Axmin’s Nimini East and West and Matotoka exploration licences, for a cash fee of US$7.5 million. Axmin will retain a 49% interest in the new company.

Completion of the transaction is expected to take around 60 days. Polo, under the terms of the agreement, will solely fund the first US$2 million of the project exploration expenditure after which both parties are to jointly fund exploration on a pro rata basis. If either side elects not to participate in certain exploration, they will face dilution of their respective interest in the project.

The prospect area is situated in the central-west Kono region of Sierra Leone, some 330 km east of the capital Freetown. The principal asset is the Komahun Gold Prospect which is located within the Nimini Hills West Licence. It has an indicated mineral resource of 370,000 tonnes grading 9.1 grams per ton of gold (110,000 ounces) and an inferred mineral resource of 3.1 million tonnes grading 4.3 g/t of gold (435,000 ounces).

Neil Herbert, Polo’s executive co-chairman and managing director, said: “These are excellent gold prospects and we are very pleased to be working on them with Axmin. This investment further develops Polo’s investment portfolio and we see significant upside potential from these prospects resulting in value for shareholders.”

In March 2009, Axmin announced the results of a preliminary economic assessment and scoping study for Komahun. The study demonstrated that Komahun has potential for development as an underground gold mine with target production levels of about 50,000 ounces per annum, with a present estimated six year mine life. In addition, economics for the prospect could be substantially enhanced by future exploration success that is targeting the immediate vertical extensions to the ore body which remain open beyond the currently investigated depth of 350 metres beneath surface.

In December 2010, the Matotoka exploration licence was renewed for a period of two years, until December 2012. Additionally, in April 2011, the Nimini Hills East and West exploration licences were granted for a two year period, until March 2013.


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Polo Resources Limited is a natural resources and mine development investment company. The Company's geographical segments include BVI/Parent, Americas, Oceania & Australasia, Africa and Europe. The Company is focused on investing in undervalued companies and projects. Its principal investment targets are companies with producing assets and/or tangible resources and reserves verified using internationally recognized standards. It also invests in exploration companies. It invests in companies that are engaged in exploration of gold, oil and gas, coal, iron ore, phosphate and copper, among others. Its investments can take the form of buyouts (with controlling interests) or strategic investments (with minority interests) in both public and private companies. It is also focused on building a portfolio of mineral and hydrocarbon assets. ZAI Corporate Finance Limited serves as an advisor to the Company. more »

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